birgir rafn thrainsson reykjavik fiber

Identifying and overcoming the challenges of implementing FTTH OPERATOR CASE STUDY

FTTx Summit Europe

London, April 24th 2012

Birgir Rafn Thrainsson, CEO

Reykjavik Fiber Network

Agenda

About Reykjavik Fiber Network The Business Model

Lessons learned

Take Rate Deployment

Service Providers Network Operations

About Reykjavik Fiber Network BACKGROUND

• Owned by Reykjavik Energy, a utility company for the city of Reykjavik in Iceland

• Building and operating an Optical Fiber Network:

For the corporate and public sector since 1999

For households (FTTH) since 2005

• FTTH status - April 2012:

Homes connected: 46 thousand

Subscribers: 17 thousand (3-play: 75%)

Take rate: 37%

• Around one thousand active

connections used by businesses

About Reykjavík Fiber Network BACKGROUND

Reykjavik Fiber Network overview BACKGROUND

The Business Model BUSINESS MODEL

Principles

Deployment • Point-to-point Active Ethernet – NGN

• Two phase approach:

• FTTH rollout to all houses in a selected area

• Order based Service delivery

Services • Active sharing with multiple Service Providers

• No end-user services provided by the Network Operator

Revenues • No startup fee for households

• Monthly fees once service is activated:

• Fixed access fee – paid by the subscriber

• Service fee based on service type – paid by the Service Provider

Lessons learned

Typical statements in favour of FTTH based services: • Increases average revenue per user (ARPU)

• Less customer churn

• Greatly improves Internet and TV experience

• Higher customer satisfaction (fewer “reboots”)

• Less load on customer support

• No legacy in network operations

• Increases real estate prices

Can you confirm or challenge

these kind of statements?

Take rate

LESSONS LEARNED

Rollout and subscriber progress

Homes connected Subscribers

Take rate

LESSONS LEARNED

Rollout and subscriber progress

Take rate (%)

Take rate LESSONS LEARNED

Consumer prices

Monthly fees very competitive to ADSL fees

+ No initial or start-up fees

= Easy purchase decision

Deployment LESSONS LEARNED

Fiber Network Rollout

1. Areas defined and prioritized

2. Get “rights of way”:

• House owner permission

• Municipality permission

3. Design

4. Fieldwork

• Pipes and manholes

• PoP station installation

• Fiber blowing and splicing

5. Quality measurements

6. Delivery to Network

Operations

7. Households and Service

Providers informed

Deployment LESSONS LEARNED

Order based Service Delivery

1. Service providers sell

Internet, IPTV and

fixed-line telephony

2. Place order to finalize

installation and

service delivery

3. Contractor installs

CPE and indoor cables

4. Service provider

installs the service

equipment and

activates the service

Deployment LESSONS LEARNED

Fiber Network & NGN Point of Presence

• We have 91 PoPs with active equipment

• Each PoP serves 300 to 2000 homes

• PoP housing owned by a utility company

or a municipality

Deployment LESSONS LEARNED

Summary

• Overbuild from the PoP to the house intake

– ready for service without any fieldwork

• No initial fees for homes

– connect ratio nearly 100%

• Households want fiber installed

– irrelevant of intended use

• Define the scope of each FTTH project

– well defined geographical area

• Deliver a bulk of connected homes

– Service Providers immediately target the

area with their sales forces

• Indoor cabling, fiber and CAT5

– included in the service delivery

Service Providers LESSONS LEARNED

• Network Operator a wholesaler and

Service Providers a retailer

• Larger SPs may not like or fully

understand the business model

- will push for a passive access

• Make sure emphasis is always towards

the subscribers

• Installation and troubleshooting may

require multiple customer visits

• Automate technical support through

web services

Network Operations LESSONS LEARNED

DOWNLOAD UPLOAD

60 Kbits/s

690 Kbits/s

330 Kbits/s

• Define scalability requirements in the beginning

• Services need to be clearly defined and not

assumed

• Don‘t postpone rollout of important network

features because you don‘t need them just yet

• Positive experience may be harmed due to

network congestions outside of your control

• Compare expected end-user behavior to reality

Thank you